FoG

I wanted to reframe Shannon's Demon which I came across lately from a betting perspective and see what it tells us about Expected Value and staking. The idea is that I have a bank, say €100.  I have a bet that I can make every day, suppose I am quite a professional and I am easily capable of finding sportsbooks offering 2/1 (3.0, +200) on a true even money chance (2.0, +100).  That is a pretty huge edge right there.  There is no way that I can screw this one up!  (Is there?). I am going to bet half my bank each time.  Its a big edge, I dont want to waste it.  Also as I half my bank it will prevent me from going bust, it may reduce during a long drawdown but cannot reach zero (in theory!) and is unlikely to go below say €1 - which would double up fast again in good times. And as likely it is to drop below €1, it is equally likely to double up to €10,000s which more than balances out that risk. So you take your €100 balance and bet half ie €50 @ 2/1 with a 50/50 chance of winning. 

I have developed a chrome extension that generates the win overrounds and place overrounds on top of the oddschecker website.  You can get it from chrome store here . This can help highlight markets where the place book is overbroke and may help to unlock some each way value. Now I have created a simple javascript calculator to help guide recommendations on staking based on Kelly but taking account of the nuance of each way betting. Warning.  This calculator is next to useless.  It assumes only one horse is value in a bad each way race, and we know that often several of the rags can be value each time.  If you are making multiple bets on the same race you have to consider the "Real" Kelly Criterion as discussed here . This is going to be a difficult calculation because not only do you need to know the probability for each horses win/place, you also need to know the probability of all the possible combos.   Warning.   It also assumes that you cannot hedge the bet.  Which in